Are you not being able to obtain loans at favorable terms since you do not have a good credit score? Do you know that you can repair bad credit record all by yourself without any professional help? All you have to do is dispute the inaccurate negative information (if any) and add positive information to your reports. Read on to know the credit repair steps to follow in order to repair your bad credit record and improve your score.
1. Order your credit reports – At first, you need to order your credit reports from the 3 major bureaus namely, Experian, Equifax and TransUnion in order to get a complete view of your credit history. You should get reports from each of these bureaus because a creditor may report to only one bureau. It is better to monitor your credit reports at regular intervals.
2. Review your reports carefully – For the purpose of credit repair, go through your reports carefully highlighting each and every information you need to dispute with the bureaus. This includes inaccurate negative information along with the past due credit accounts – to look for whether or not they’ve been charged off. While highlighting the negative information, do not forget to go through your personal information as well. Highlight if there’s any mistake in your name, SSN, etc.
3. Dispute incorrect information – The next step is to dispute the negative information with the specific bureau. To do so, make a copy of your report, highlight the specific item(s) and send a letter to the specific bureau(s) explaining why the information is incorrect. You may have to attach necessary documents in support of the information you need to dispute. You should dispute with each of the bureaus that display the incorrect information.
4. Get current on your accounts – Your payment history plays an important role in deciding your score. So, an important aspect of credit repair is to get current on all your accounts. Try to have either “Current” or “Paid” status against all your accounts. So, if required, work with debt collectors regarding your accounts that have gone to collections and pay the charge offs. Also, do not max out your credit cards and repay the balances in order to bring down the limit.
In addition, you should try to add positive information in your credit reports. To do so, you can open a new credit account and repay the balance at every billing cycle. If you are not able to obtain a credit card, you can take out a secured credit card. Above all, plan a budget and manage your expenses and your credit/debts in order to have a good credit score.